What is the difference between secured and unsecured loans?

Difference between secured and unsecured loans is a critical decision for your budget. ### Unsecured Personal Loan No collateral required. You don't fear losing assets. However, interest rates are higher. You need a good credit history. Banks are hesitant about low scores as the risk is entirely theirs. ### Secured Personal Loan Requires surrendering something valuable (Property, Car, Jewellery) as collateral. Benefits include lower interest rates and higher borrowing limits. Lenders are more amenable even to average credit scores. ### The Trade-off Unsecured = High interest + Convenience. Secured = Low interest + Risk of asset loss. Whatever you choose, be sure about your ability to afford the monthly installments. ### Conclusion Decision depends on your financial assessment. Check with big banks for terms or let experts help you get a loan that suits your budget.